89R1144 CXP-F
By: Cain H.B. No. 941
A BILL TO BE ENTITLED
AN ACT
relating to the resilience of the electric grid and certain
municipalities.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. The legislature finds that:
(1) electric grid outages threaten the lives of the
citizens of this state and pose a disproportionately large risk to:
(A) the elderly, vulnerable, and underprivileged
within this state; and
(B) communities facing disproportionate
environmental health burdens and population vulnerabilities
relating to facilities such as chemical plants and refineries that
can become environmental disaster areas when taken off-line due to
loss of electricity;
(2) the 16 critical infrastructure sectors identified
in President Barack Obama's Presidential Policy Directive
"Critical Infrastructure Security and Resilience" (PPD-21)
(chemical, commercial facilities, communications, critical
manufacturing, dams, defense industrial base, emergency services,
energy, financial services, food and agriculture, government
facilities, healthcare and public health, information technology,
nuclear reactors, materials, and waste, transportation systems,
water and wastewater systems) depend on the electric grid in this
state and make the grid's protection vital to the economy of this
nation and homeland security;
(3) the power outage that occurred in this state in
February 2021 caused:
(A) death and suffering in this state;
(B) economic loss to this state's economy;
(C) impacts to all critical infrastructures in
this state;
(D) the dispatch of generation units that likely
exceeded limits established by the Environmental Protection Agency
for sulfur dioxide, nitrogen oxide, mercury, and carbon monoxide
emissions and wastewater release limits;
(E) radically increased pricing of electricity
and made electric power bills unaffordable to many customers across
this state; and
(F) exacerbation of COVID-19 pandemic risk by
forcing many of the state's citizens to consolidate at warming
centers and in other small spaces where warmth for survival
superseded social distancing protocols;
(4) a previous large-scale power outage occurred in
this state in February 2011 during which 4.4 million customers were
affected;
(5) this state is uniquely positioned to prevent power
outages because this state is a net exporter of energy and is the
only state with an electric grid almost exclusively within its
territorial boundaries;
(6) the 2011 and 2021 power outages call into
question:
(A) whether too much risk has been accepted
regarding weatherization of electric generation infrastructure;
(B) whether this state lacks the internal
distribution structure and control systems to manage rolling
outages; and
(C) whether sufficient resources have been
allocated toward overall grid resilience;
(7) public confidence in the resilience of the
electric grid in this state is essential to ensuring economic
prosperity, domestic tranquility, continuity of government, and
life-sustaining systems;
(8) a resilient electric grid that offers businesses
in this state continuity of operations in the event of a natural or
man-made disaster will be an unrivaled attraction for businesses to
expand or move their operations to this state;
(9) a resilient electric grid that can operate in the
event of a natural or man-made disaster will protect important
facets of this state, including its military installations and
environment;
(10) current market incentives and regulations are not
sufficient for electric utilities to:
(A) prioritize grid security and resilience; and
(B) protect the grid against hazards;
(11) protection of the electric grid in this state
against hazards would assure businesses and the citizens of this
state that the "lights will be back on first in Texas" in the event
of a nationwide catastrophe affecting electric infrastructure,
sparing this state from catastrophic societal and environmental
consequences; and
(12) when this state begins implementation of the plan
for all hazards resilience described by Section 44.007, Utilities
Code, as added by this Act, to protect the electric grid in this
state, short-term and long-term economic benefits will far exceed
even the most optimistic estimates of the conventional economic
incentives provided by tax abatements to attract businesses to this
state.
SECTION 2. Subtitle B, Title 2, Utilities Code, is amended
by adding Chapter 44 to read as follows:
CHAPTER 44. GRID RESILIENCE
Sec. 44.001. DEFINITIONS. In this chapter:
(1) "All hazards" means:
(A) terrestrial weather including wind,
hurricanes, tornadoes, flooding, ice storms, extended cold weather
events, heat waves, and wildfires;
(B) seismic events including earthquakes and
tsunamis;
(C) physical threats including terrorist attacks
with direct fire, drones, explosives, and other methods of physical
sabotage;
(D) cyber attacks including malware attacks and
hacking of unprotected or compromised information technology
networks;
(E) manipulation of operational technology
devices including sensors, actuators, and drives;
(F) electromagnetic threats through man-made
radio frequency weapons, high-altitude nuclear electromagnetic
pulses, and naturally occurring geomagnetic disturbances;
(G) electric generation supply chain
vulnerabilities including insecure or inadequate fuel
transportation or storage; and
(H) insider threats caused by compromised or
hostile personnel working within government or the utility
industry.
(2) "Micro-grid" means a group of interconnected loads
and distributed energy resources inside clearly defined electrical
boundaries.
(3) "Security commission" means the Texas Grid
Security Commission.
Sec. 44.002. TEXAS GRID SECURITY COMMISSION. (a) The Texas
Grid Security Commission is composed of the following members:
(1) a representative of the Texas Division of
Emergency Management appointed by the chief of that division;
(2) a representative of the commission appointed by
that commission;
(3) a representative of the Railroad Commission of
Texas appointed by that commission;
(4) a representative of the independent organization
certified under Section 39.151 for the ERCOT power region appointed
by the chief executive officer of that organization;
(5) a representative of power generation companies
appointed by the chief of the Texas Division of Emergency
Management; and
(6) a representative of transmission and distribution
utilities appointed by the chief of the Texas Division of Emergency
Management.
(b) The Texas Division of Emergency Management shall
designate a member of the security commission to serve as presiding
officer.
(c) The security commission shall convene at the call of the
presiding officer.
(d) The security commission shall report to the chief of the
Texas Division of Emergency Management.
(e) A vacancy on the security commission is filled by
appointment for the unexpired term in the same manner as the
original appointment.
(f) To the extent possible, individuals appointed to the
security commission must be residents of this state.
(g) The chief of the Texas Division of Emergency Management
may invite officials or former officials of the United States
Department of Defense or Department of Homeland Security with
expertise on electromagnetic pulse defense to advise the security
commission.
(h) The presiding officer of the security commission or the
chief of the Texas Division of Emergency Management may invite to
advise the security commission any person whose expertise the
security commission considers necessary to carry out the purposes
of this chapter, including individuals recognized as experts in the
fields of law enforcement, emergency services, communications,
water and sewer services, health care, financial services,
agriculture, transportation, electricity markets, cybersecurity of
grid control systems, electromagnetic pulse mitigation,
terrestrial and solar weather, and micro-grids.
Sec. 44.003. GRID RESILIENCE INFORMATION. (a) Each of the
following members of the security commission shall apply for a
secret security clearance or an interim secret security clearance
to be granted by the federal government:
(1) the representative of the independent
organization certified under Section 39.151 for the ERCOT power
region;
(2) the representative of the Texas Division of
Emergency Management; and
(3) the representative of the commission.
(b) A member of the security commission listed under
Subsection (a) who is granted an applicable security clearance
under that subsection is a member of the information security
working group.
(c) The information security working group shall determine:
(1) which information created or obtained by the
security commission is confidential;
(2) which members of the security commission may
access which types of information received by the security
commission; and
(3) which members, other than members of the working
group, should apply for a secret security clearance or interim
clearance granted by the federal government.
(d) Information that the information security working group
determines is confidential under Subsection (c) shall be stored and
maintained by the independent organization certified under Section
39.151 for the ERCOT power region.
(e) The security commission must maintain a reasonable
balance between public transparency and security for information
determined to be confidential under Subsection (c).
(f) Confidential information created or obtained by the
security commission is not subject to disclosure under Chapter 552,
Government Code.
(g) A meeting of the security commission that involves the
discussion of confidential information is not subject to Chapter
551, Government Code.
Sec. 44.004. GRID RESILIENCE EVALUATION. (a) The security
commission shall evaluate, using available information on past
power outages in ERCOT, all hazards to the ERCOT electric grid,
including threats that can cause future outages. The security
commission shall evaluate the resilience of municipalities in this
state in the following essential areas:
(1) emergency services;
(2) communications systems;
(3) water and sewer services;
(4) health care systems;
(5) financial services;
(6) energy systems, including whether energy,
electric power, and fuel supplies are protected and available for
recovery in the event of a catastrophic power outage; and
(7) transportation systems.
(b) The security commission may create groups to identify
and address each hazard as necessary. The security commission must
assess each hazard both on the likelihood of occurrence of the
hazard and the potential consequences of the hazard.
(c) The security commission shall identify methods by which
this state can support an overall national deterrence policy as
proposed by the United States Cyberspace Solarium Commission,
including by:
(1) identifying means to ensure that measures taken to
increase resilience of electric utilities against all hazards
support critical national security functions in this state; and
(2) engaging the Texas National Guard to be trained as
first responders to cybersecurity threats to the ERCOT electric
grid and other critical infrastructure.
(d) The security commission shall evaluate nuclear
generation sites in this state, the resilience of each nuclear
reactor to all hazards, and the resilience to all hazards of
off-site power for critical safety systems that support the reactor
and spent fuel. The security commission may communicate with the
Nuclear Regulatory Commission to accomplish the evaluation.
(e) The security commission shall evaluate current Critical
Infrastructure Protection standards established by the North
American Electric Reliability Corporation and standards set by the
National Institute of Standards and Technology to determine the
most appropriate standards for protecting grid infrastructure in
this state.
(f) The security commission shall investigate the steps
that local communities and other states have taken to address grid
resilience. The security commission may request funding from the
Texas Division of Emergency Management to conduct site visits to
these locations as required.
(g) The security commission shall identify universities
based in this state that have expertise in cybersecurity and other
matters that can contribute to the security commission's goal of
mitigating all hazards to the grid in this state.
(h) In carrying out the security commission's duties under
this section, the security commission may solicit information from:
(1) defense contractors with experience protecting
defense systems from electromagnetic pulses;
(2) electric utilities that have developed
electromagnetic pulse protections for the utilities' grid assets;
(3) the United States Department of Homeland Security;
and
(4) the Commission to Assess the Threat to the United
States from Electromagnetic Pulse (EMP) Attack.
Sec. 44.005. RESILIENCE STANDARDS. (a) Based on the
findings of the evaluations and investigations conducted under
Section 44.004, the security commission shall consider and
recommend resilience standards for municipalities and critical
components of the ERCOT electric grid.
(b) Standards considered and recommended for energy systems
of municipalities should include provisions to ensure that energy,
electric power, and fuel supplies are protected and available for
recovery in the event of a catastrophic power outage.
(c) Not later than October 1, 2026, the security commission
shall prepare and deliver a report to the legislature on the
recommended resilience standards required under this section and an
anticipated timeline for implementation of the standards.
Sec. 44.006. MICRO-GRIDS. The security commission shall
recommend resilience standards for micro-grids. The standards must
be developed for both alternating current and direct current.
Sec. 44.007. PLAN FOR ALL HAZARDS RESILIENCE. (a) Not
later than October 1, 2026, the security commission shall prepare
and deliver to the legislature a plan for protecting the ERCOT
electric grid from all hazards, including a catastrophic loss of
power in the state.
(b) The plan must include:
(1) any weatherization requirements in addition to
requirements established under Section 35.0021 necessary to
prevent power outages from extreme cold weather events, an analysis
of whether these requirements would induce cyber vulnerabilities,
and an analysis of the associated costs for these requirements;
(2) provisions for installing, replacing, or
upgrading industrial control systems and associated networks, or
the use of compensating controls or procedures, in critical
facilities to address cyber vulnerabilities;
(3) provisions for installing, replacing, or
upgrading extra high-voltage power transformers and supervisory
control and data acquisition systems to withstand 100
kilovolts/meter E1 electromagnetic pulses and 85 volts/kilometer
E3 electromagnetic pulses;
(4) a timeline for making improvements to remaining
infrastructure to meet resilience standards adopted by the security
commission under Section 44.005;
(5) long-term resilience provisions for supporting
industries including:
(A) communications;
(B) food supply;
(C) fuel supply;
(D) health care;
(E) nuclear reactors, materials, and waste;
(F) transportation; and
(G) water and sewer services; and
(6) any additional provisions considered necessary by
the security commission.
(c) The security commission may consult with the Private
Sector Advisory Council in developing the plan.
Sec. 44.008. GRID RESILIENCE REPORT. (a) Not later than
January 1 of each year, the security commission shall prepare and
deliver a nonclassified report to the legislature, the governor,
and the commission assessing natural and man-made threats to the
electric grid and efforts to mitigate the threats.
(b) The security commission shall make the report available
to the public.
(c) In preparing the report, the security commission may
hold confidential or classified briefings with federal, state, and
local officials as necessary.
SECTION 3. This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution. If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect September 1, 2025.